Back in June there was the post election budget (or whatever they might call it). We know that there is a change to child allowances etc if you earn over a particular threshold (sounds unfair) but I know of some changes that might offset. But not searched enough yet. Anyone have the facts to hand?
I know the tax free allowance goes up by £1000 in April (you can earn £7475 before paying any tax) and the 40% threshold also will go up. But what does it go up to. That is the main reason for me to post.
Trying to work out what car I might get later next year and these figures obviously make a difference. Slight maybe but still a difference. Could work out better to go for a nice turbo petrol (higher BIK but the allowance might cover some of that) instead of a more pricey list priced diesel.
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So from that (which I've read) at what point do you pay 40% tax in the 2011/2012 tax year?
I'd read that and other info before asking the question. It's currently £37400 and I believe it is going up - and if so by how much?
Last edited by: rtj70 on Mon 13 Dec 10 at 23:22
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You want the files from here
www.hmrc.gov.uk/budget-updates/index.htm#9
2 December 2010
Tax, NICs, Tax Credit, and ISA rates, thresholds, limits for 2011/12.
* Written Ministerial Statement (PDF 30K)
www.hmrc.gov.uk/budget-updates/written-min-statement.pdf
* Tables of Rates and Thresholds 2011/2012 (PDF 112K)
www.hm-treasury.gov.uk/d/rates_thresholds_tables.pdf
That shows 40% band coming down.
Personal allowance goes up from £6475 to £ 7,475
40% tax band starting goes down from taxable income of £37,401 to £35,001.
Last edited by: Suppose on Mon 13 Dec 10 at 23:26
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Thanks.
Edit: so the conservatives put up taxes then ;-) My clue to changes came from a relative at the weekend who seems to have got it wrong.
Last edited by: rtj70 on Mon 13 Dec 10 at 23:34
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My calculations make that £1/month worse off (or was that better off... spreadsheet closed) for me then. And that includes the BIK for my car going up by 1% next April. But a big thanks for digging that out. I could have trawled the HMRC site but hoped someone on here dealt with this kind of thing and had it to hand. The top level pages could have had this info but they choose not to.
A bigger change is due to pension scheme changes - more like £40+/month worse off.
I assume this is meant to be a neutral change to benefit those not paying 40% tax.
Last edited by: rtj70 on Mon 13 Dec 10 at 23:45
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>> Edit: so the conservatives put up taxes then
That's what you get if you get in to bed with progressive Liberals.
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I think it's what you get after 13 years of throwing money at problems but not solving them.
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>> I think it's what you get after 13 years of throwing money at problems but
>> not solving them.
>>
Ain't that the truth!
Thatcher had to resort to drastic cuts and sell off the silver to save the country after the spend spend spend days of Healey and Callaghan.
Now history is being repeated after the spend spend spend days of Brown and Blair.
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The cuts aren't even really cuts. They're just reductions in the growth of public sector spending so in a few years we'll still be spending just as much on the public sector. It's been like this since the war. The dispatches about the trillion pound debt is an eye opener. Worth catching if it is still on 4od.
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"The cuts aren't even really cuts"
So an average 8% reduction in the grant to local authorities is really an increase?
Fascinating... explains why our local council is cutting spending then...:-)
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>> So an average 8% reduction in the grant to local authorities is really an increase?
>> Fascinating... explains why our local council is cutting spending then...:-)
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The overall public spending budget is what the "cuts are not cuts" refers to. Because some areas have been ring-fenced, they will see a rise in real expenditure while other areas will suffer real cuts.
Your local authority could ask staff to take 10% pay cuts as many private companies did last year and before.
Last edited by: Suppose on Tue 14 Dec 10 at 11:26
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>> The cuts aren't even really cuts.
Yes but the news Media don't like to let facts get in the way of a good fictional story.
The difficulty is that when you cut stuff like EMA, Housing Benefit, Child Benefit, and increase Tuition Fees, the public and media blame it on Tory dogma. They have got used to getting these benefits as a right paid from a trillion pound debt mountain, and feel that the benefits must remain in perpetuity regardless of the ability of taxpayers to fund the debt.
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...feel that the benefits must remain in perpetuity regardless of the ability of taxpayers to fund the debt...
I would add public sector pensions to the list.
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...feel that the benefits must remain in perpetuity regardless of the ability of taxpayers to fund the debt...I would add public sector pensions to the list....
"The deficit in the Local Government Pension Scheme in England has more than doubled in the last three years from £42bn to £100bn, research suggests."
www.bbc.co.uk/news/business-11996504
That cannot be sustainable, even using the Toytown economics of the town hall.
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>> Edit: so the conservatives put up taxes then
Not by more than a fraction.
Old money:
0-6,475@0% = £0
6,476-43,876@20% = 20%*37,401 = £7,480
New money:
0-7,475@0% = £0
7,476-42,476@20% = 20%*35,001 = £7,000
42,476-43,876@40% = 1,400*40% = £560
Total £7,560 compared with £7,480.
Extra tax charge is therefore £80, or just over a pound a week.
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But you forgot about the 1% point increase in NICs (although that was pre-election - and is it still on, or is it now 0.5% can't remember exactly).
There's also the fiscal drag element whereby more people are going to be paying 40% tax, and the amount of tax free allowance has not increased by inflation (for HR tax payers anyway).
I foresee a reduction in my net income of £1500 / year (inc the VAT increase and fuel duty and loss of child tax credit) - about a 5% pay cut. I don't suppose my employer will keep up with that in salary increases....
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Budget and 2011/12 Changes - CGNorwich
